Should I Get A Savings Account Or Over 50s Life Insurance plan?

Are you considering protecting your family from financial hardship after you pass away? Well, we think it’s a great idea. There are many different options that will be open to you, so you first have to consider your circumstances.

ISA’s and Over 50s life Insurance Plan

ISA’s and Over 50s Life Insurance are two different financial products that you can use to provide your family with money after you pass away.

An ISA is a tax-efficient savings account with a yearly allowance of £15,240.

It is important to think about why you want to save, before you decide what the right way for you to save is. There are many differences between a savings account and an Over 50s Life Insurance plan. Depending on what you’re saving for and your circumstances, one could be much more suitable for you than the other.

Shepherds Friendly offers both an Over 50s Life Insurance Plan and a Stock and Shares ISA. Whichever plan better suits your circumstances, we will be able to help.

Planning for your funeral?

With the average funeral now costing upwards of £4,078, you may want to put your mind at ease, to know that your loved ones won’t have to struggle to pay for your funeral after you have gone. With a Shepherds Friendly Over 50s Life Insurance plan, you can be reassured that there will be a lump sum payable on your death which can be used towards the cost of paying for your funeral.

We even offer a £250 additional funeral bonus if you choose to have your sum assured paid directly to Golden Charter funeral services. They will then arrange your funeral for you, working with your family. This will hopefully make the whole experience easier for your family, and is a great benefit if you are looking to pay for your funeral.

Want to leave a lump sum for your partner or children?

If you would like to leave a lump sum of money for your family when you pass away, both plans could work out for you, depending on your circumstances.

Your age and general health have a big role to play here. If you are nearer 50 than 90, have really good health and no history of family medical problems, an ISA may be the better option for you. This is because you can carry on saving for years to come, and as the Over 50s Life Insurance plan only pays out upon death, you might be making payments for a long time.

If you have a history of bad health, are nearer to 80 years old than 50, and have a guaranteed amount in mind you know you would like to have paid out, an Over 50s Life Insurance could better suit your needs. As long as you pay your instalments for two years, you will get the full agreed upon lump sum, even if you have only paid in a fraction of the lump sum in your instalments. If you where to open an ISA, the money you receive would be the money you paid in, possibly with some growth added, but nothing more.

How are you with your money?

Have you ever had a savings account before? Have you found yourself dipping in and out of it, every time you need a little extra cash, eroding your savings? If this sounds like you, an over 50s Life Insurance plan sounds like it would suit your habits more.

There is no way you can release any of the money you pay into an Over 50s Life Insurance plan as it has no cash value. The purpose of the plan is to make sure a lump sum is guaranteed to go to your estate when you die. This means you can not dip in and out of it, yet your money is guaranteed.*

If you trust yourself to manage your money efficiently so there will be some left when you die, saving your money monthly into an ISA may be a better solution because a combination of your payments and any growth added may result in a higher lump sum when you die.

There are many different ways in which an Over 50s Life Insurance plan or an ISA might suit your needs. If you are considering preparing for your future, it might be best for you to speak to a financial adviser. If you would like any more information from us on either of tour products, please call our friendly customer service team on 0800 526 249.

*provided you keep paying your monthly instalments as required

Please note: All information within Your Resource Centre is correct at the time of publication, and we make every effort to keep content accurate. However sometimes information may be out of date. You should not rely on this information when making financial decisions as no financial advice has been given. The information reflects the view of the author and not that of Shepherds Friendly Society.

If you’re not sure what to do when making financial decisions then you should consult a financial adviser, who will likely charge for any advice that is given.

Shepherds Friendly
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1544 Reviews

The whole experience of setting up ISA's for my baby twins was extremely easy. The online application was very straight forward and painless. When I rang customer services to discuss paying lump sums into the ISA's I found the lady I spoke with to be warm, friendly and professional....and dare I say it...British.

KATHLEEN

Staff were friendly on the phone and explained the process well and answered all of my questions.

Shepherds Friendly is a trading name of The Shepherds Friendly Society Limited
which is an incorporated Friendly Society under the 1992 Friendly Societies Act No. 240F.
Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct
Authority and the Prudential Regulation Authority. FS Registration Number 109997.

When you take out an investment product with us your capital is at risk and you may get
back less than you have put in. All references to taxation are to UK taxation and are based on Shepherds Friendly Society's
understanding of current legislation and H M Revenue and Customs practice which may change
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amount of which cannot be guaranteed throughout the term of the contract.